The Sixth Consecutive Rate Hike by ECB Results in €1,650 Increase in Tracker Cost Annually.

The European Central Bank (ECB) has raised interest rates for the sixth time in the past year, significantly impacting those with tracker mortgages. The move has increased the cost of such mortgages by €1,650 a year and will likely have a ripple effect across the overall economy. This decision by the ECB has sparked debate and concern among homeowners, businesses, and financial experts alike, causing many to question the long-term implications of these steady rate hikes.


The European Central Bank’s sixth interest rate rise since last summer will result in higher repayments for homeowners with tracker mortgages. The latest rise, which represents a 0.5 percentage point increase, will cost an average of €1,650 per year on a typical tracker mortgage. The cost of new fixed rates is also expected to rise, potentially making it more difficult for first-time buyers to enter the property market. Approximately 50,000 homeowners are set to come out of fixed-rate arrangements in the next three years and are being advised by financial advisers to re-fix before rates increase even further. There are currently 244,000 tracker mortgage holders in Ireland and the total impact of rises to date represents an additional €6bn in repayments. To avoid inaction, homeowners with tracker mortgages must secure a fixed rate or talk to a mortgage broker to determine their best course of action. Non-bank lender Finance Ireland and AIB subsidiary EBS have increased their lending rates in response to the changes.


In conclusion, the European Central Bank’s decision to hike interest rates for the sixth time is certainly a cause for concern among homeowners with tracker mortgages. With an increase in monthly payments of €1,650 a year, many may find it difficult to keep up with their mortgage payments, leading to financial difficulties and potentially even defaulting. However, it’s important to keep in mind that interest rates have remained historically low for some time, and it’s still possible to find attractive mortgage deals out there. Staying informed and seeking the advice of financial experts can help you navigate the often complex world of mortgages, ensuring that you make the best decisions for your financial well-being.